The following steps will be essential in ensuring that you start your sauce business effectively.
1. Business Plan
This is not a legal requirement as your business can be registered without a business plan. It is good to
have a business plan as it will elaborate on the strategy that will be used by the company. This will also
provide a marketing strategy that the company will use. In the business plan, the basic cost and the
pricing strategy will be highlighted. A business plan can be relevant when one applies or needs a loan
from commercial banks.
2. Create a recipe
It is essential to have a recipe; the recipe will need to have the ingredients proportional to maintain the
taste. Even with the change of recipe, the sauce should just taste similar to the initial sauce. Therefore, it
is good to have the measurements and timings to be precise. This will be required by the Food and Drug
administration to ensure that the components used are safe for human consumption.
It is important to copyright your recipe make sure that they are safe, this can be done through reaching
the U.S copyright office. The purpose of registering the recipe is to ensure that you will not have
4. Food regulation on home-based business
Since your sauce business will be operated from the house, the Food and Drug Administration (FDA)
regulations will be necessary. A sample of the sauce will be sent to the FDA for laboratory testing to
confirm if the sauce meets the standards. It will be imperative to get to know the federal, state, and
local legal requirements. Therefore, it will be necessary if you reach the FDA District Office and the state
and local regulatory agencies. This will provide relevant information and legal requirements that you
need to adhere to.
5. Registration with the IRS
It is necessary to register with the Department of Revenue within the state the business will be
operating and with the Internal Revenue Services. To register with the IRS, it will be necessary to
complete the employer identification number form on the IRS website. The EIN generated can be used
to complete the registration of the business within your state.
6. State Laws
It will be important for you to check with your state regulation on matters of food production. The
majority of the states allow for food production at home for commercial sale, however, other states
provide for the sale of a particular quantity of food produced at home.
7. Business License
After obtaining the tax number, and all the relevant licenses have been obtained then you will be issued
with a business license that will allow you to continue operating your business. The business license will
be from the state in which the business will be based in.